Karachi: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI), through its President Atif Ikram Sheikh, has expressed significant concern regarding the country's trade balance during the first two months of Fiscal Year 2026-27 (FY27). The trade deficit has expanded by 18.1 percent, reaching $7.1 billion, compared to $6.025 billion during the same period last year.

According to Federation of Pakistan Chambers of Commerce and Industry, the increase in exports has been overshadowed by a more substantial rise in imports, posing an immediate threat to macroeconomic stability and foreign exchange reserves. Mr. Atif Ikram Sheikh emphasized that the widening gap isn't due to a lack of industrial capacity but is primarily driven by the high cost of doing business, which has rendered export-oriented industries uncompetitive in global markets.

The FPCCI President pinpointed several critical issues affecting industrial productivity, notably high interest rates set by the central bank, which have stifled private sector credit growth. He also highlighted the impact of rising electricity tariffs and unstable gas supply costs on production, stating that these factors have severely limited the competitiveness of key export sectors.

Mr. Sheikh further pointed out that the domestic industries face significant challenges due to the highest regional interest rates and expensive energy inputs. This situation has led to a reliance on expensive imports to meet domestic demand, exacerbating the trade deficit and putting pressure on the national economy.

The FPCCI has called for urgent intervention from the Prime Minister, the Ministry of Finance, the Ministry of Commerce, and the State Bank of Pakistan to collaborate with the business community. The organization demands a reduction in policy rates, rationalization of utility tariffs, and relief on petroleum levies to alleviate supply chain costs and support industrial production, aiming to prevent industrial closures and meet FY27 export targets.